Wednesday, November 27, 2013

James E. McCarthy
Specialist in Environmental PolicyAs the 113th Congress continues consideration of air quality issues, oversight of
Environmental Protection Agency (EPA) regulatory actions is expected to
remain the main focus. Of particular interest are EPA’s Clean Air Act
regulations on emissions of greenhouse gases. President Obama’s June 25
announcement of initiatives to address climate change and EPA’s subsequent
(September 20) proposal of GHG emission standards for new fossil-fueled
power plants sparked renewed interest in the issue.

Air quality has improved substantially in the United States in the 40 years of
EPA’s Clean Air Act (CAA) regulation. According to the agency’s science
advisers and others, however, more needs to be done to protect public
health and the environment from the effects of air pollution. Thus, the agency
continues to promulgate regulations using authority given it by Congress in CAA amendments
more than 20 years ago. Members of Congress from both parties have raised questions
about the cost-effectiveness of some of these regulations and/or whether the
agency has exceeded statutory authority in promulgating them. Others in
Congress have supported EPA, noting that the Clean Air Act, often affirmed
in court decisions, has authorized or required the agency’s actions.

EPA’s regulatory actions on GHG emissions have been the main focus of
congressional interest in 2013. Although the Obama Administration has
consistently said it would prefer that Congress pass new legislation to
address climate change, such legislation now appears unlikely. Instead, over
the last four years, EPA has developed GHG emission standards using its
existing CAA authority. Relying on a finding that GHGs endanger public
health and welfare, the agency promulgated GHG emission standards for cars
and light trucks on May 7, 2010, and again on October 15, 2012, and for
larger trucks on September 15, 2011. The implementation of these standards,
in turn, triggered permitting and Best Available Control Technology
requirements for new major stationary sources of GHGs (power plants,
manufacturing facilities, etc.).

It is the triggering of standards and permit requirements for stationary
sources that has raised the most concern in Congress. A proposal to limit
carbon dioxide emissions from new power plants is the focus of attention
currently, but other sources (refineries, cement plants, etc.) could be subject to
GHG emission controls under the same statutory authority. In addition to the
proposed standards for new power plants, the President has directed EPA to
develop standards for existing power plants by June 2015.
Legislation has been introduced in both the House and Senate aimed at
preventing EPA from implementing such requirements. The House passed several of
these bills in the 112th Congress, but none passed the Senate. Meanwhile, EPA has implemented
permit and Best Available Control Technology requirements for new stationary
sources of GHGs. A challenge to these requirements will be heard by the
Supreme Court in early 2014.

Besides addressing climate change, EPA has taken action on a number of other
air pollution regulations, generally in response to court actions
remanding previous rules. Remanded rules included the Clean Air Interstate
Rule (CAIR) and Clean Air Mercury Rule—rules designed to control the
long-range transport of sulfur dioxide, nitrogen oxides, and mercury from power plants
through cap-and-trade programs. Other remanded rules included hazardous air
pollutant standards for boilers and cement kilns. EPA also recently
proposed a controversial rule to lower the sulfur content of gasoline, in
conjunction with tighter (“Tier3”) standards for motor vehicle emissions.

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Tuesday, November 26, 2013

Jonathan L. Ramseur
Specialist in Environmental PolicyIn 1970, Congress enacted legislation directing the President to promulgate
oil spill prevention and response regulations. This presidential authority
was delegated to the Environmental Protection Agency (EPA) by President
Nixon in 1970. In 1973, EPA issued Spill Prevention, Control, and
Countermeasure (SPCC) regulations that require applicable facilities to
prevent, prepare, and respond to oil discharges that may reach navigable
waters of the United States or adjoining shorelines. Among other
obligations, SPCC regulations require secondary containment (e.g., dikes
or berms) for certain oil-storage units. In addition, SPCC plans must generally
be certified by a licensed Professional Engineer.

In recent years, the SPCC regulations have received considerable interest from
Congress. Most of this interest has involved the applicability of SPCC
regulations to farms, which account for approximately 25% of SPCC
regulated entities, second only to oil and gas production facilities. Farms
may be subject to the SPCC regulations, because they store oil onsite for
agricultural equipment use.

In 2002, EPA issued a final rule that made changes and clarifications to its
SPCC regulations. The compliance date for this rule was extended on
multiple occasions. For most types of facilities subject to SPCC
requirements, the compliance deadline was November 10, 2011. However, EPA extended
this compliance date for farms to May 10, 2013. Related to this deadline,
Congress enacted P.L. 113-6 on March 26, 2013, which included a provision
prohibiting EPA from using appropriations to enforce SPCC provisions at
farms for 180 days after enactment (i.e., through September 22, 2013).

In addition, some Members in the 113th Congress have offered multiple proposals that include provisions
that would alter the scope and applicability of the SPCC regulations. All of
these provisions would revise the applicability to farms under the SPCC
regulations. In general, the bills’ provisions would alter the aggregate
oil storage threshold that triggers compliance with SPCC regulations. Such
provisions are included in the House version of the farm bill (H.R. 2642) and
the Senate version of the Water Resources Development Act of 2013 (S. 601).

The argument in support of recent SPCC legislation often concerns the financial
impact of the SPCC regulations to farms. For example, a 2012 House report
stated that the “mandated infrastructure improvements—along with the
necessary inspection and certification by a specially licensed
Professional Engineer will cost many farmers tens of thousands of dollars.”
However, others have argued that EPA has considered the costs and benefits
of its SPCC regulations during multiple rulemaking processes.

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Monday, November 25, 2013

Mary Tiemann
Specialist in Environmental PolicyIn the Safe Drinking Water Act (SDWA) Amendments of 1996, Congress
authorized a drinking water state revolving loan fund (DWSRF) program to
help public water systems finance infrastructure projects needed to comply
with federal drinking water regulations and to meet the act’s health
objectives. Under this program, states receive annual capitalization grants to
provide financial assistance (primarily subsidized loans) to public water
systems for drinking water projects and other specified activities.
Through June 2012, Congress had provided $14.7 billion for the DWSRF
program, and combined with the 20% state match, bond proceeds, and
other funds, the program generated $23.6 billion in assistance and
supported 9,990 projects.

The latest Environmental Protection Agency (EPA) survey of capital improvement
needs for public water systems indicates that these water systems need to
invest $384.2 billion on infrastructure improvements over 20 years to
ensure the provision of safe tap water. EPA reports that, although all of
the identified projects promote the public health objectives of the SDWA,
just $42.0 billion (10.9%) of reported needs are attributable to SDWA
compliance.

Key program issues include the gap between estimated needs and funding; the
growing cost of complying with SDWA standards, particularly for small
communities; the ability of small or economically disadvantaged
communities to afford DWSRF financing; and the broader need for cities to
maintain, upgrade, and expand infrastructure unrelated to SDWA compliance.
Several overarching policy questions are under debate, including, “What is
the appropriate federal role in providing financial assistance for local
water infrastructure projects?” and “What other funding mechanisms could
supplement or replace a program reliant on annual appropriations?”

In recent appropriations acts, Congress has added new conditions to assistance
provided through the DWSRF program. The American Recovery and Reinvestment
Act of 2009 (ARRA; P.L. 111- 5)
provided $2 billion in supplemental funding through the DWSRF program for
drinking water infrastructure projects. ARRA applied Davis-Bacon
prevailing wage and “Buy American” requirements to projects receiving any
ARRA DWSRF funding, and required that 20% of the funds be reserved for
“green” projects. For FY2012, Congress provided $917.9 million for
the DWSRF program (P.L. 112-74). In the act, Congress made the green
infrastructure reserve discretionary, but expanded the application of
Davis-Bacon requirements to the DWSRF program to include FY2012 and all
future years.

For FY2013, the President requested $850 million for the program. Under the
Consolidated and Continuing Appropriations Act, 2013 (P.L.
113-6), EPA planned to allocate $861.3 million
for the program, after accounting for rescission and sequestration
reductions. The President has requested $817 million for FY2014.

The 113th Congress is considering alternative financing approaches for water
infrastructure. The Senate passed S. 601, the Water Resources Development Act of 2013. Title X of this bill,
the Water Infrastructure Finance and Innovation Act of 2013, would
establish a pilot loan guarantee program to test the ability of innovative
financing tools to promote increased development of, and private
investment in, water infrastructure projects. The bill states that it is
intended to complement, not replace, the SRF programs. S.
335, the Water Infrastructure Finance and Innovation
Act of 2013, would establish a financing program at EPA to provide direct loans
and loan guarantees for a range of water infrastructure and water resource
management projects.

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